Customs Act, 1962 Section 108b — Penalty for failure to furnish information return
Customs Act, 1962 · Penalty for failure to furnish information return
Plain-English Explanation
Overview
Section 108B of the Customs Act, 1962, deals with the penalty levied for failing to furnish an information return as required under Section 108A. It ensures compliance by penalizing individuals who neglect to provide requested information to Customs authorities within the specified timeframe. This section is crucial for effective customs enforcement and preventing illicit activities.
Who Does This Apply To?
This section applies to any person or entity who is obligated to furnish information under Section 108A of the Customs Act, 1962. This includes, but isn't limited to, importers, exporters, transporters, warehouse keepers, and any other individual or organization whom the customs authorities believe possess relevant information regarding goods being imported or exported. The crucial trigger is receiving a notice under Section 108A(3) requiring specific information.
How It Works
Here's a breakdown of how the penalty mechanism operates:
- Information Request: The proper officer (Customs official) issues a notice under Section 108A(3) to a person, requiring them to furnish specific information within a stipulated period.
- Failure to Furnish: If the person fails to provide the required information within the timeframe mentioned in the notice, Section 108B comes into play.
- Penalty Imposition: The proper officer can then direct the defaulting person to pay a penalty. The penalty is calculated at the rate of ₹100 for each day the failure to furnish information continues.
- Continuous Default: The penalty accumulates for each day of non-compliance, meaning the longer the delay, the higher the penalty amount.
Important Conditions & Exceptions
- Condition 1: The penalty is applicable only if a notice under Section 108A(3) has been duly served and the information is not furnished within the specified period. Verbal requests or informal demands do not trigger the penalty.
- Condition 2: The penalty is levied for each day of the default. Even a partial delay beyond the stipulated timeframe will attract a penalty proportionate to the delay.
- Exception: While the act doesn't explicitly define circumstances for waiving the penalty, the proper officer may consider factors such as genuine hardship or unintentional error while deciding on enforcement and potential reduction of penalties. Documentation justifying such circumstances is crucial.
Practical Example
A trading company, "XYZ Importers," receives a notice under Section 108A(3) from the Customs department, requesting details of their import transactions for the past quarter within 15 days. XYZ Importers fail to provide the information within the stipulated 15-day period. They finally submit the information 25 days after the deadline. In this case, XYZ Importers would be liable to pay a penalty. The penalty would be calculated as ₹100 per day for the 25 days of delay, totaling ₹2500 (₹100 x 25). They would need to remit this penalty to the government.
Key Amendments
No major amendments since enactment.
No case laws found for this provision yet.
Browse all case laws →Frequently Asked Questions
What is the penalty under Section 108B of the Customs Act, 1962 for failing to furnish information?
Section 108B of the Customs Act, 1962 prescribes a penalty for failing to furnish information as required under Section 108A. The penalty is ₹100 for each day the failure to furnish the information continues, starting from the day after the deadline specified in the notice issued under Section 108A(3).
To whom does Section 108B of the Customs Act, 1962 apply?
Section 108B applies to any person who is required to furnish information under Section 108A of the Customs Act, 1962. This typically involves individuals or entities involved in import or export activities who are served a notice under Section 108A(3) requiring them to provide specific information relevant to customs investigations.
How is the penalty under Section 108B calculated, and what is the maximum penalty?
The penalty is calculated at ₹100 per day for each day the information is not furnished after the deadline specified in the notice under Section 108A(3). The legal text does not specify a maximum penalty. Therefore the penalty theoretically could keep accruing indefinitely.
What triggers the penalty under Section 108B of the Customs Act, 1962?
The penalty is triggered by the failure to furnish information requested under Section 108A within the time period specified in the notice issued under Section 108A(3). Timely and complete compliance with the notice is critical to avoid this penalty.
What are the practical implications of Section 108B for businesses involved in import/export?
Businesses involved in import/export must maintain accurate records and be prepared to furnish information promptly upon receiving a notice under Section 108A. Failure to do so can result in a daily penalty under Section 108B, leading to potentially significant financial burdens and increased scrutiny from customs authorities.
How can a person avoid penalties under Section 108B of the Customs Act, 1962?
To avoid penalties under Section 108B, ensure timely and complete compliance with any notice received under Section 108A(3). This includes gathering the required information accurately and submitting it within the stipulated deadline. Proactive record-keeping and a clear understanding of customs regulations are essential for compliance.
Are there any provisions for appeal or waiver of penalties levied under Section 108B of the Customs Act, 1962?
While Section 108B outlines the penalty, the Customs Act, 1962 provides avenues for appeals against orders and decisions made by customs authorities. The specific grounds for appeal and the procedures involved are detailed elsewhere in the Act (e.g., Section 128). It is advisable to consult with a customs law expert regarding the possibility of waiver based on mitigating circumstances.
Key Conditions & Requirements
| Condition | Details |
|---|---|
| Information return requirement | A person must be legally obligated to furnish information under Section 108A of the Customs Act, 1962. |
| Failure to furnish information | The person fails to provide the required information within the period specified in the notice issued under Section 108A(3). |
| Issuance of Notice | A notice must have been properly issued under Section 108A(3) specifying the information required and the deadline for submission. |
| Proper officer's authority | The 'proper officer' has the authority to impose the penalty. |
| Penalty amount | The penalty is one hundred rupees for each day the failure to furnish the information continues. |
| Payment direction | The proper officer must direct the person to pay the penalty. |
| No exemptions specified | The provision does not explicitly mention any specific exemptions from the penalty. |
Amendment History
Inserted (w.e.f. 1-7-2017 vide Notification No. 25/2017-Cus., dated 28-6-2017) by s. 3 of the Taxation Laws (Amendment) Act, 2017 (18 of 2017).